City of Lawrence, Kansas
Third Quarter Report – 2005
Purpose of Report
The following information summarizes the financial activities of the City of Lawrence for the first nine months of 2005 and advises the City Commission as to current budgetary conditions. In the first section, the budgetary highlights from the major funds of the City are itemized, including the General, Recreation, and Transportation Funds, which are partially funded by property taxes, and the Water & Sewer, Sanitation, Storm Water and Public Golf Course Funds, which are enterprise funds supported by user fees. The second section provides tables that compare year to date financial activities to the budget and prior year results for the same period. Included in the third section is a summary of the investment activities for the period. The fourth section summarizes the amount of outstanding debt. The final section provides information on capital project financing.
I. BUDGETARY HIGHLIGHTS
General Fund
● General Fund revenues are nearly 85% of budget and increased by $2.7 million or 7.5% compared to the same period last year.
● The $2.7 million increase in revenue was partially the result of a $750,000 rise in property taxes. The property tax increase was the result of a 6.5% growth in assessed valuation and a 1.0% decrease in the 2004 levy for the 2005 budget.
● Another component of the increase in General Fund revenue was a $538,000, or 3.5%, rise in sales tax distributions. Year to date city and county sales tax distributions are $201,000 over projections.
● An additional increase in General Fund revenue was a $332,000 increase in court fines over the same period in 2004. Court costs were increased in September 2004.
● General Fund expenditures were less than 75% of budget but increased by 13.4% over the same period last year. As a reminder, over $600,000 of budgeted capital outlay expenditures were moved from the General Fund to the Equipment Reserve Fund in 2004. No department receiving funding from the General Fund has expended over 75% of their budget.
Special Revenue Funds
● Recreation Fund service charge revenues increased by 9.6% compared to the previous year. The increase is primarily the result of increases in pool revenue.
● Recreation Fund expenditures should finish the year below budget.
● Public Transportation Fund expenditures were only 57% of budget. The amount includes an encumbrance of the payments to MV Transportation through the end of the year. However, MV Transportation has requested a meeting to discuss modifying their contract to allow a fuel price escalator provision.
Enterprise Funds
● Water and Sewer Fund revenue increased 8.9% over the same period last. The increase was primarily the result of the 4% water rate increase and 9% sewer rate increase.
● Water and Sewer Fund expenses were up significantly from the prior year due to an increase in the transfer to cash finance capital projects. Operating expenses were less than 70% despite large encumbrances for chemicals and maintenance items.
● Golf Course Fund revenue showed improvement during the quarter and was 75% of budget. However, revenue for the year is expected to be less than 90% of budget.
● Golf Course Fund expenses were 75% of budget. The amount represents a decrease of $40,000 compared to 2004.
● The Golf Course Fund is projected for expenditures to exceed revenues by approximately $80-90,000 in 2005. Since the fund started the year with only $15,000 in cash some type of interfund transfer will be required prior to year end.
II. REVENUE – EXPENDITURE TABLES
Third Quarter Fund Analysis
|
|
|
20043rd Qtr. |
% of budget |
20053rd Qtr. |
% of budget |
|
General Fund |
|
|
|
|
|
|
|
Revenue Source |
|
|
|
|
|
|
Taxes |
$13,222,863 |
89.8 |
$14,050,722 |
87.7 |
|
|
Sales Tax |
15,159,608 |
84.7 |
15,698,754 |
78.5 |
|
|
Licenses & Permits |
753,085 |
117.7 |
743,184 |
96.5 |
|
|
Intergovernmental |
552,029 |
86.0 |
541,304 |
84.3 |
|
|
Service Charges |
317,896 |
86.6 |
490,218 |
127.5 |
|
|
Fines |
1,680,052 |
112.0 |
2,012,325 |
99.6 |
|
|
Interest |
250,677 |
50.1 |
615,641 |
153.9 |
|
|
Miscellaneous |
2,638,908 |
79.5 |
2,797,585 |
87.7 |
|
|
Transfers |
909,875 |
72.2 |
1,210,831 |
76.2 |
|
|
Total Revenue |
35,484,993 |
87.6 |
38,160,564 |
84.6 |
|
|
|
|
|
|
|
|
|
Expenditures |
|
|
|
|
|
|
General Government |
9,952,191 |
69.4 |
11,859,802 |
72.6 |
|
|
Public Safety |
14,423,054 |
68.3 |
15,280,391 |
68.5 |
|
|
Public Works |
3,736,983 |
72.9 |
4,945,123 |
74.0 |
|
|
Parks & Recreation |
1,871,167 |
70.5 |
1,927,749 |
66.1 |
|
|
Total Expenditures |
29,983,395 |
69.3 |
34,013,065 |
70.5 |
|
|
|
|
|
|
|
|
|
Revenues over Expenditures |
5,501,598 |
|
4,147,499 |
|
|
|
|
20043rd Qtr. |
% of budget |
20053rdQtr. |
% of budget |
Recreation Fund |
|
|
|
|
|
|
|
Revenue Source |
|
|
|
|
|
|
Taxes |
$329,795 |
89.0 |
$292,068 |
93.2 |
|
|
Service Charges |
1,126,126 |
83.4 |
1,233,793 |
91.9 |
|
|
Miscellaneous |
6,028 |
|
2,553 |
|
|
|
Transfers |
900,000 |
75.0 |
978,000 |
75.0 |
|
|
Total Revenue |
2,361,949 |
80.9 |
2,506,414 |
84.1 |
|
|
|
|
|
|
|
|
|
Expenditures |
|
|
|
|
|
|
Parks & Recreation |
1,998,560 |
64.5 |
2,173,497 |
67.3 |
|
|
|
|
|
|
|
|
|
Total Expenditures |
1,998,560 |
64.5 |
2,173,497 |
67.3 |
|
|
|
|
|
|
|
|
|
Revenues over Expenditures |
363,389 |
|
332,917 |
|
|
|
|
20043rd Qtr. |
% of budget |
20053rd Qtr. |
% of budget |
|
||||||
|
Transportation Fund |
|
|
|
|
|
|
||||||
|
|
Revenue Source |
|
|
|
|
|
||||||
|
|
Taxes |
$1,132,791 |
90.7 |
$981,742 |
90.4 |
|
||||||
|
|
Service Charges |
116,423 |
122.6 |
121,466 |
141.2 |
|
||||||
|
|
Miscellaneous |
19,089 |
0.0 |
0 |
0.0 |
|
||||||
|
|
Total Revenue |
1,268,303 |
94.4 |
1,103,208 |
90.4 |
|
||||||
|
|
|
|
|
|
|
|
||||||
|
|
Expenditures |
|
|
|
|
|
||||||
|
|
Public Transportation |
1,149,600 |
57.0 |
1,154,099
|
56.9 |
||||||
|
|
Total Expenditures |
1,149,600 |
57.0 |
1,154,099 |
56.9 |
|
||||||
|
|
|
|
|
|
|
|
||||||
|
|
Revenues over (under) Expenditures
|
118,703 |
|
(50,891) |
|
|
||||||
|
2004 Enterprise Funds |
Water & Sewer |
|
Sanitation |
|
Storm |
|
Golf |
|
|
|
|
% |
|
% |
|
% |
|
% |
Revenue Sources |
|
|
|
|
|
|
|
|
|
Service Charges |
$16,762,075 |
83.7 |
$6,151,883 |
81.8 |
$2,117,516 |
88.2 |
808,636 |
68.1 |
|
Interest |
367,297 |
90.8 |
51,083 |
85.1 |
24,114 |
241.1 |
53 |
1.8 |
|
Intergovernmental |
0 |
|
33,825 |
|
0 |
|
0 |
|
|
Miscellaneous |
191,571 |
|
111,214 |
260.1 |
50 |
|
837 |
|
|
Total Revenues |
17,320,943 |
85.7 |
6,348,005 |
83.3 |
2,141,680 |
88.9 |
809,526 |
68.0 |
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
|
Operations |
18,820,918 |
59.0 |
6,085,680 |
67.3 |
1,524,645 |
60.2 |
915,011 |
76.9 |
|
|
|
|
|
|
|
|
|
|
|
Net Income |
(1,149,975) |
|
262,325 |
|
617,035 |
|
(105,485)) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2005 Enterprise Funds |
Water &Sewer |
|
Sanitation |
|
Storm |
|
Golf |
|
Revenue Sources |
|
|
|
|
|
|
|
|
|
Service Charges |
$18,239,829 |
85.7 |
$6,260,750 |
78.4 |
$2,096,596 |
82.2 |
$816,351 |
75.2 |
|
Interest |
537,901 |
179.3 |
65,628 |
109.4 |
57,535 |
383.6 |
0 |
|
|
Intergovernmental |
0 |
|
0 |
|
0 |
|
0 |
|
|
Miscellaneous |
120,542 |
241.0 |
120,708 |
243.9 |
7,129 |
|
1,189 |
|
|
Total Revenues |
18,898,272 |
87.4 |
6,447,086 |
79.7 |
2,161,260 |
84.3 |
817,540 |
75.1 |
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
|
Operations |
22,585,054 |
65.5 |
6,985,001 |
70.4 |
2,278,902 |
59.9 |
874,935 |
74.6 |
|
|
|
|
|
|
|
|
|
|
|
Net Income |
(3,686,782) |
|
(537,915) |
|
(117,642) |
|
(57,395) |
|
|
|
|
|
|
|
|
|
|
|
III. INVESTMENTS
Short term investment rates have increased significantly in the last year. As a result, our interest earnings are greater than the first nine months of 2004. Interest revenue should meet or exceed the budget in 2005 for most funds.
As of September 30, 2005, the City of Lawrence had over $139 million in cash and investments. A total of $89.3 million was invested in securities. The amount of cash was unusually high due to the sale of both revenue and general obligation bonds and notes during the quarter. The investments were 15% in certificates of deposits, 44% in government agencies and 36% was in cash. The City’s investment policy limits the portfolio to a maximum of 30% in any one financial institution’s certificates of deposit. The City’s certificates of deposit are with Commerce Bank, Capitol Federal and Corner Bank. The average rate of return on our investments during the second quarter was 3.62%.
Over 96% of the City’s portfolio has an original maturity of less than twelve months. Only 3% of our securities had a maturity longer than twenty four months. The City plans on holding its investments to maturity and has sufficient cash and short-term investments to avoid a liquidity crisis that would force the sale of the longer-term investments.
IV. DEBT ISSUANCE
For the period of time covered in this report (first nine months of 2005), the City has issued $25,910,000 in revenue bonds, $11,095,000 in general obligation bonds, and $22,128,000 in temporary notes. The City closed on its most recent general obligation debt issuance on September 29, 2005. The water and sewer revenue bond issue included an advance refunding of the $8.935 million in existing revenue bonds.
The following table shows the current total outstanding debt for the City and the different funding sources. A preliminary analysis has shown that the City can issue approximately $4.0 – 5.0 million in at-large general obligation annually without having an adverse impact on the debt levy.
|
City of Lawrence Estimated Debt 9/30/05 |
||||
|
|
GO Debt |
Enterprise |
Less Enterprise Portion of GO Debt |
Total |
|
Long term debt, 1/1/05 |
$ 74,885,000 |
$ 64,853,123 |
$(6,745,305) |
$ 132,992,818 |
|
|
|
|
|
|
|
Debt, added August 2005 |
0 |
25,910,000 |
- |
25,910,000 |
|
|
|
|
|
|
|
Debt, added September 2005 |
11,095,000 |
5,007,925 |
(5,007,925) |
11,095,000 |
|
|
|
|
|
|
|
Debt, added, Kansas Water Supply Loan |
- |
0 |
- |
0 |
|
|
|
|
|
|
|
Less: Principal paid in 2005 |
(8,900,000) |
(12,126,369) |
796,042 |
(20,230,327) |
|
|
|
|
|
|
|
Total long term debt, 9/30/05 |
$ 77,080,000 |
$ 83,644,679 |
$ (10,957,188) |
$ 149,767,491 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total long term debt is composed of: |
|
|
|
|
|
Enterprise fund portion |
$ 10,957,188 |
$ 72,687,491 |
$ - |
$ 83,644,679 |
|
Sales tax portion |
9,883,363 |
- |
- |
9,883,363 |
|
Benefit District Debt (estimated) |
10,350,880 |
- |
- |
10,350,880 |
|
Net long term debt, city at large, 9/30/05 |
45,888,569 |
10,957,188 |
(10,957,188) |
45,888,569 |
|
Total long term debt, 9/30/05 |
77,080,000 |
83,644,679 |
(10,957,188) |
149,767,491 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Future long term debt will result from: |
|
|
|
|
|
Notes currently outstanding which will be bonded (includes fall note issue) |
$22,128,000 |
$ - |
$ - |
$ 22,128,000 |
V. CAPITAL BUDGET
As of September 30, 2005 expenditures in the capital project fund totaled $25.7 million. Funding sources for these projects consisted of $22.1 million temporary notes, $4.3 million in cash, and $30.7 million in general obligation bonds. The list does not include projects funded by the Water and Sewer Fund. The table indicates that an additional $15.5 million in project costs will be encumbered or notes repaid.
Detailed information on the status of the projects is shown in the following table.
|
|
|
|
|
|
|
|
|
|
PROJECT NAME |
AMOUNT |
FINANCED |
OTHER |
TOTAL RECEIPTS |
EXPENDITURE |
ENCUMB |
AVAILABLE BALANCE |
|
2004 KLINK 6th st, Az to Ak |
350,000 |
325,134 |
199,500 |
524,634 |
524,214 |
|
420 |
|
2005 KLINK 6th St. MO to Mass |
|
401,600 |
|
401,600 |
469,823 |
|
-68,223 |
|
W. 6th St., Wakarusa to SLT |
3,295,000 |
5,508,915 |
209,927 |
5,718,843 |
5,710,350 |
|
-8,483 |
|
Carnegie Library Renovation |
400,000 |
677,350 |
71,069 |
748,419 |
423,975 |
82,712 |
242,232 |
|
Fire Station #5, 19th & Stewart |
5,000,000 |
5,179,909 |
1,360 |
5,181,269 |
1,826,826 |
3,004,471 |
349,972 |
|
Harvard Traffic Calming |
|
402,604 |
|
402,604 |
398,159 |
|
3,545 |
|
Monterey Way, Stetson Dr |
4,850,000 |
4,870,340 |
|
4,870,340 |
871,003 |
1,086,021 |
2,913,317 |
|
2004 Fire Truck Purchase |
300,000 |
301,200 |
|
301,200 |
|
299,993 |
1,207 |
|
2005 Fire Truck Purchase |
|
|
|
|
695,271 |
|
-695,271 |
|
2005 Overlay |
376,000 |
380,000 |
|
380,000 |
375,620 |
|
4,380 |
|
O’Connell Road, 23rd - 31st |
2,300,000 |
1,157,982 |
117,267 |
1,275,269 |
579,154 |
50,837 |
645,278 |
|
Airport Runway Reconstruction |
|
|
1,305,792 |
1,305,792 |
1,237,155 |
209,604 |
-140,967 |
|
Kasold, 15th to Clinton Parkway |
6,750,000 |
250,875 |
|
250,875 |
204,763 |
30,886 |
15,227 |
|
3rd, Alabama to Illinois |
140,000 |
140,490 |
|
140,490 |
8,183 |
1,757 |
130,550 |
|
2004 Overlay, Phase II |
473,781 |
1,044,952 |
|
1,044,952 |
347,867 |
|
697,567 |
|
2005 Overlay, Phase II |
323,000 |
322,467 |
|
322,467 |
232,408 |
|
-941 |
|
2002 Traffic Signals |
200,000 |
406,279 |
|
406,279 |
161,608 |
45,037 |
199,634 |
|
Overland, Congressional to Queens |
1,500,000 |
2,010,542 |
|
2,010,542 |
995,225 |
|
1,015,315 |
|
Congressional, North of 6th |
700,000 |
856,225 |
|
856,225 |
423,237 |
|
432,988 |
|
6th & Lawrence Traffic Signal |
|
541,106 |
|
541,106 |
263,893 |
|
257,213 |
|
Lake Pointe, Clinton Parkway to 22nd |
1,166,250 |
752,625 |
147,664 |
900,289 |
712,140 |
175,110 |
13,039 |
|
Orchard’s Conservation Easement |
280,000 |
499,571 |
67,337 |
566,908 |
281,351 |
|
285,557 |
|
Monterey Way, Peter to GV |
2,620,000 |
2,797,167 |
|
2,797,167 |
212,393 |
1,122,166 |
1,462,608 |
|
Wakarusa Service Center |
|
|
|
|
|
78,260 |
-78,260 |
|
23rd St Access Management |
550,000 |
150,525 |
|
150,525 |
46,966 |
100,829 |
2,730 |
|
Peterson, Kasold to Monterey Way |
3,420,000 |
3,635,942 |
|
3,635,942 |
320,658 |
1,970,078 |
1,345,206 |
|
Riverside Business Park Sewer |
900,000 |
675,501 |
|
675,501 |
292,577 |
|
382,924 |
|
Kasold & Peterson Rd Intersection |
300,000 |
325,050 |
|
325,050 |
13,950 |
6,450 |
304,651 |
|
O’Connell Rd left turn lane |
328,960 |
328,145 |
|
328,145 |
|
20,745 |
311,385 |
|
Kasold, Peterson to KTA |
770,000 |
210,735 |
|
210,735 |
160,937 |
42,963 |
6,834 |
|
7th & Kentucky |
50,000 |
129,624 |
|
129,624 |
100,807 |
|
28,817 |
|
Harvard Rd, East of GWW |
550,000 |
468,974 |
7,172 |
476,146 |
381,648 |
41,065 |
53,433 |
|
Barker, 16th to 22nd |
550,000 |
1,068,136 |
|
1,068,136 |
498,773 |
|
569,362 |
|
George Williams Way, 6th to Harvard |
2,500,000 |
4,171,803 |
|
4,171,803 |
1,595,009 |
10,273 |
2,566,522 |
|
19th & Louisiana Traffic Signal |
315,000 |
59,322 |
|
59,322 |
35,190 |
2,409 |
21,723 |
|
Bob Billings & Wakarusa |
200,000 |
200,700 |
|
200,700 |
76,702 |
17,268 |
106,730 |
|
Public Works Facility - Development |
300,000 |
302,416 |
|
302,416 |
131,562 |
|
170,854 |
|
Folks Rd, 6th to Harvard |
1,820,000 |
1,128,301 |
|
1,128,301 |
1,048,129 |
3,272 |
76,900 |
|
Art Center Expansion |
|
|
53,650 |
53,650 |
6,500 |
0 |
47,150 |
|
Investments |
|
|
1,939,403 |
1,939,403 |
|
|
1,939,403 |
|
Misc. private projects |
|
|
136,390 |
136,390 |
119,929 |
|
16,460 |
|
900 New Hampshire TIF District |
8,650,000 |
8,747,408 |
5,251 |
8,752,659 |
8,258,889 |
|
493,771 |
|
Fire Station #4 2121 Wakarusa |
150,000 |
2413,416 |
15,850 |
2,429,266 |
50,492 |
2,319,342 |
59,432 |
|
|
|
|
|
|
|
|
|
|
|
|
52,843,332 |
4,277,652 |
57,120,984 |
30,200,922 |
10,743,413 |
16,176,649 |